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Wednesday, 3 May 1961


Mr Whitlam m asked the Treasurer, upon notice -

1.   What interest rates have been charged in the last ten years by (a) the Commonwealth, State and private savings banks on credit foncier loans and loans to building societies, (b) the Commonwealth, State and private trading banks on overdraft for housing purposes, and (c) life assurance companies on housing loans?

2.   What monthly payments would a home purchaser have to pay to these banks, societies and companies for each £1,000 borrowed at the respective interest rates over periods of 15, 20, 25, 30 and 35 years?


Mr Harold Holt - The answers to the honorable member's questions are as follows: - 1 (a). The following table shows the interest rates charged during the past ten years by the Commonwealth, State and private savings banks on housing loans to individuals and on loans to terminating building and housing societies: -

 

(b)   The maximum permissible overdraft rates of interest chargeable by trading banks which are subject to Commonwealth banking legislation have been - from January, 1951, 44 per cent, per annum; from August, 1952, 5 per cent, per annum; from April, 1956, 6 per cent, per annum (average rate not to exceed 54 per cent.); and from November, 1960, 7 per cent, per annum (average rate not to exceed 6 per cent.). It has not been the practice within these maxima for the trading banks to quote specific rates to apply generally to loans for housing. However, it is the understanding of the Reserve Bank that most trading bank loans to individuals for housing would have borne interest from April, 1956, to November, 1960, within the range of 5 per cent, to 54 per cent, and that since November, 1960, the range has been 5i per cent per annum to 6i per cent, per annum. It is also understood that rates charged by the State trading banks have been generally in line with these rates, (c) The rate of interest charged by life assurance companies on housing loans is determined by the individual company. It is understood most of these companies are currently charging either 64 per cent, per annum or 7 per cent, per annum.

2.   The following table shows the monthly credit foncier repayments for each £1,000 borrowed at various interest rates and for various terms. In the case of trading bank overdrafts repayment is a matter for arrangement between banker and customer: -

 







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